Wednesday, August 25, 2004

Costco is Cheap

Perhaps in more ways than the obvious one:

A federal civil rights lawsuit was filed against Costco Wholesale Corporation for bias against female employees on Tuesday. The suit is seeking class-action status to represent as many as 650 women, the San Francisco Gate reports. The lead plaintiff in the case, Shirley "Rae" Ellis of Colorado, claims that women are rarely promoted to high-level management jobs, and that openings for these positions are not posted. According to the Associated Press, while 50 percent of Costco's employees are female, only 12 percent of their store managers are women.

Filing a suit doesn't mean that it is justified, of course, but it's interesting that so many similar suits have been filed in the recent past about discrimination in promotions (Wal-Mart, Morgan Stanley, Boeing Corp.). It's also interesting that at least two of these suits cited the fact that openings are not posted. Lack of information about open jobs would certainly keep many employees from applying, don't you think?

It's worth noting that the percentages of women in the general labor force of the firm and in its management may differ for several reasons and discrimination by the firm is only one of them. Costco will probably try to argue that women don't apply for promotions as much as men do for reasons that are outside Costco's control. Like inherent sex differences in motivations or societal inculcation of different values. The plaintiffs have to provide evidence that shows the firm acting in a way which makes it harder for women to get promoted. Keeping new vacancies secret might qualify as one of those.